Playbook for Reducing Technology Spend Post Acquisition

After acquiring a tech-enabled services business, our focus during our 100 day plan was to prioritize learning, not changing. We wanted to avoid causing disruption without first understanding why things were the way they were. That said, we found one area where we could generate meaningful early wins without impacting customers or employees, which was in our technology, subscriptions and licenses costs. Using the framework below, we reduced recurring subscription spend by 25% during our first month of owning the business, translating into roughly 10% run-rate EBITDA growth in the first month. Step 1: Prioritize Ruthlessly The goal wasn’t to renegotiate everything, but to focus time where returns were obvious. We categorized vendors across two dimensions: (1) Potential cost savings and 2) Time required to achieve them. - High savings / Low time → Do immediately (low-hanging fruit) - High savings / Med–High time → Queue as medium-term projects - Low savings / Low time → Delegate - Low savings / High time → Ignore How we identified “high savings” 1. We set a minimum hurdle: a 25% potential cost savings needed to justify ~2 hours of effort. 2. We pulled a Cost by Vendor report from our accounting system (which can be reconstructed from bank/card statements if its not accessible elsewhere). 3. Vendors were sorted by annualized spend, largest to smallest. 4. Anything below the hurdle was excluded. Step 2: Understand Pricing Models and Contract Constraints Working down the prioritized list: - Vendors with fixed contracts not expiring within ~3 months were paused and calendar-reminded. - Vendors with self-serve portals (seat-based, usage-based, tiered plans) were tackled first. This step doubled as a crash course in understanding our vendor base and how we should think about budget costs going forward. Step 3: Eliminate License and Usage Bloat This is where most of the savings came from. Suppliers have no incentive to flag over-licensing, and in businesses that haven’t actively managed vendors, bloat is common. We consistently found savings in: - Unused seats or licenses tied to former employees, customers, or abandoned initiatives - Over-tiering, where usage sat well below the plan level being paid for Once identified, most plans could be right-sized immediately, with savings starting that month or the next billing cycle. Step 4: Optimize Payment Timing and Billing Mechanics We reviewed recent invoices for: - Payment terms & late fees - In some cases, we were paying early (hurting working capital). - In others, we were paying late and incurring avoidable fees. - Payment method - Some vendors accepted credit cards without a surcharge, unlocking working capital. - Others charged card fees, where other payment methods were cheaper even after cost of capital. - Annual prepayment discounts - Several vendors offered 15–25% discounts for annual plans. - We only did this where usage was highly predictable - For the rest, we made note of this option and created a report to monitor usage. Step 5: Reach out to Account Managers Even where plans could be changed via self-serve portals, we still engaged account managers. This served three purposes: - Clarified what services we were actually paying for - Exposed pricing, packaging, or contract flexibility not visible online - Established a working relationship early Vendors are incentivized to help customers grow, particularly when they see a credible long-term partner. We used these conversations to understand their priorities, product roadmap, and where they were investing resources. When there was clear alignment between their focus and our strategy, that vendor became a priority partner to leverage moving forward. In other cases, the discussion surfaced simpler outcomes: our current plan was misaligned with how we actually used the product and could be adjusted to better fit our needs. Step 6: Schedule a list Medium-Term Initiatives & Projects Not all opportunities uncovered during this process were quick wins. In many cases, creating value would require time and resources to realize. While these aren’t the priority for this exercise, it created a pipeline of initiatives worth revisiting later. What were were looking for were areas where we were not leveraging services effectively, where we were spending meaningful amounts on non-core services and where there is overlap in our vendor base. If others have found areas that helped generate early wins, I’d be interested to hear what’s worked for you. And if you’re going through a similar exercise or want to compare notes on technology optimization, feel free to reach out.